Trading Update

There is no change to the previous guidance in relation to FY24 outturn although, given the developments referred to below, De La Rue’s full year results are now expected to be announced in late July.

Order Books

Positive momentum in both our Authentication and Currency divisions with a number of significant recent contract wins and renewals.

Authentication

We are pleased to announce that we have reached agreement with two existing Government Revenue Solutions customers for multi-year extensions to their contracts, for three and five years respectively, for the supply of a digital tax stamp solution to track and trace excisable products.

This brings the total of substantial contract renewals that De La Rue Authentication has achieved within the last 12 months to four. Together, these renewals carry with them expected total contract values exceeding £150m. De La Rue’s Authentication division now holds multi-year contracts with anticipated future revenues of over £350m, equivalent to approximately three and a half times FY24 total revenues, highlighting the long-term nature and strength of this division.

Currency

De La Rue’s Currency division continues to progress, based on the actions undertaken over the past four years and the strong contract win-rate, in a recovering market for banknotes and associated components. The division’s order book increased to £239m at the end of March and since that time we have secured agreements for further orders totalling approximately £60m. This compares favourably to the order book of £137m at the end of FY23, and the £220m announced last December, and has been achieved even in the context of strong Q4 shipments.

Strategic Update

As set out in the Company’s half year results on 19 December 2023 and in the trading update on 17 April 2024, the Board has been undertaking a review of the core strategic strengths of the Group and how best to optimise the underlying intrinsic value of the business for the benefit of all stakeholders.

This review and analysis has included:

- recognising the improved order intake over the last year, and the future prospects for the Group’s operating divisions and the Group as a whole;

- the accretive value creation that may be achieved with increased scale and capabilities in both of our operating divisions; and

- our commitment to reduce leverage and create greater financial flexibility in the funding structure of the Group as a whole.

This review, and associated learnings, has guided the Board in its process to evaluate strategic options for the group and each division. As a result, the Board is in discussions with a number of parties who have made proposals in relation to, or expressed interest in, either of the Group’s divisions, although at this stage there can be no certainty that the interest received by the Company will result in a transaction(s), nor as to the terms of any such transactions. A further announcement will be made in due course.

Clive Vacher, Chief Executive Officer at De La Rue commented, "We are delighted to extend our relationship with these high-profile customers within our Authentication division. This, alongside other recent renewals and the expanding Currency order book, demonstrates further progress in the development of De La Rue which will help to underpin our performance in FY25."

Clive Whiley. Chairman at De La Rue commented, "Since my appointment a year ago, the Board has considered a broad range of possible strategic alternatives including transactions with multiple parties which may involve a combination with, or the sale of, the Group’s divisions. The Board confirms that the discussions with the relevant parties are advancing, and we expect to update further at the time of the full year results in July."

The person responsible for the release of this announcement on behalf of De La Rue for the purposes of MAR is Jon Messent (Company Secretary).